SRB objects FBR jurisdiction in suspension of internet service provider

KARACHI: Sindh Revenue Board (SRB) has objected the exercise of power by Federal Board of Revenue (FBR) in case of suspending sales tax registration of an internet service provider.

The sources on Wednesday said that the SRB in a letter to FBR objected the jurisdiction exercised by Corporate Regional Tax Office (CRTO) stating that the federal government is no more have jurisdiction over the services as those only vested with the provincial revenue authorities.

“It is pertinent to mention that the said services were excluded from the purview of Table-II of the First Schedule to the Federal Excise Act, 2005, vide Finance Act, 2014, meaning thereby that this is not an excisable service,” the SRB said.

It further noted that being a service and not goods, it is not liable to federal sales tax under the Sales Tax Act, 1990, and also being a non-excisable service, it ceases to be selected for sales tax audit for the period of July 2015 to June 2016.

The SRB also advised Commissioner CRTO that the legality and propriety of the suspension of registration of M/s Gemnet Enterprises Solutions (Pvt) Ltd. under section 21(2) of the Sales Tax Act, 1990 may be please be looked into for appropriate necessary action at your end.

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